ASFMRA AgNews - Vol. 13 Issue VII [February 13, 2018]

Farmers Predict Stable Land Values

Optimism about farmland prices is ticking up for farmers. That’s according to the Purdue/CME Group November 2017 Ag Economy Barometer by Purdue University’s Center for Commercial Agriculture. The monthly survey polls 400 U.S. producers to gauge the health of the ag economy.

“A record-low number of producers—only 17%—indicated they expect lower farmland values in the year ahead,” says James Mintert, director of Purdue University’s Center for Commercial Agriculture. “We also had a modest uptick of farmers expecting higher farmland values. People are becoming more optimistic, or at least less pessimistic, about what’s taking place in terms of farmland values.”

For the first time in the history of the survey (data collection began in October 2015), more producers expect farmland values to increase in the upcoming year than decline.

UAV Software Leader Looks at Future

If you think drones are popular now, wait and see what happens in the future. That’s the word from Mike Winn, chief executive officer and co-founder of DroneDeploy. His company makes software for agriculture and many other industries, including archaeology.

Here are Winn’s views about how unmanned aerial vehicles and the data they collect can find a fit on your farm. He shares his thoughts in this interview with Indiana Prairie Farmer.

2018 Cotton Crop Now Eligible for ARC/PLC Programs

The National Cotton Council greatly appreciates Congress’ passage of a supplemental disaster bill that includes critically needed policy that restores eligibility for cotton in the Title I ARC/PLC programs of the farm bill. The legislation also includes important agricultural disaster assistance, as well as additional support to dairy producers.

“This measure will provide cotton producers and lenders some certainty as they prepare for the 2018 growing season,” NCC Chairman Ronnie Lee said. “The new policy will help ease the financial burden as producers struggle to cover total costs.”

The Georgia cotton producer said the U.S. cotton industry is very appreciative of the strong leadership of Senate Appropriations Committee Chairman Cochran (R-MS) and House Agriculture Committee Chairman Conaway (R-TX) that made it possible to advance this important policy through the House and Senate. He said the industry also is very grateful for the key support of Representatives Aderholt (R-AL), Bishop (D-GA), Peterson (D-MN), and Arrington (R-TX) and Senators Roberts (R-KS), Cornyn (R-TX), Boozman (R-AR), Shelby (R-AL), Leahy (D-VT), and Stabenow (D-MI).

Conaway Hopes Farm Bill is Voted On Before End of March

House Agriculture Committee Chairman Mike Conaway, R-Texas, hopes the new Farm Bill will receive a vote in the House of Representatives before the end of March.

Conaway, who addressed the crop insurance industry’s annual convention Feb. 5, said that timetable would leave plenty of time to work out differences with the Senate version of the bill and ensure new legislation is finalized before the Farm Bill expires at the end of September.

“We will have difficult decisions to make,” he said, noting that there is “no reason to put it off just because [the debate] will be hard.”

Crop Insurance Acreage, Farmers’ Expense For it Up in 2017

With 311 million acres enrolled in the system, 2017 was a historic year for crop insurance. For perspective, that’s an area roughly the size of California, Texas and New York combined.

Insurers backed more than $106 billion worth of crops in 2017, up $6 billion since 2016. And farmers paid $3.7 billion out of their own pockets for insurance protection – a more than $250 million increase from the year before, said Mike Day, chairman of National Crop Insurance Services, during the industry’s recent annual meeting.

“Today, crop insurance protects around 90 percent of the insurable land and more than 130 different kinds of crops,” said Day in a prepared statement, who also heads Rural Community Insurance Services for Zurich North America. “Congress made crop insurance the cornerstone of farm policy, and it is important not just for farmers and rural communities, but for taxpayers and consumers alike.”

Keeping Afloat as Net Farm Income Sinks

This week, the U.S. Department of Agriculture (USDA) its net farm income forecast for 2018, and it could be the industry’s worst in more than a decade.

USDA anticipates net farm income, a broad measure of profits, to decrease nearly 7 percent from 2017 to $59.5 billion, the lowest net farm income number since 2006. Net cash farm income is also forecast to decrease down about 5 percent to $91.9 billion, the lowest level since 2009.

Perdue: Farm Economy is Fragile

Agriculture Secretary Sonny Perdue is telling a congressional hearing this week the farm economy is in a fragile state. During his testimony to the House Agriculture Committee, Perdue laid out his perspective on the state of the ag industry, including major issues and unknowns lingering on the horizon. Chinese leaders are doing the same in the sorghum market.

During the hearing, Perdue highlighted China launching an anti-dumping probe of U.S. sorghum and its impact on farm country.

“We think the sorghum issue will nullify over a period of time,” said Perdue. “It just shows how fragile and how sensitive the ag economy and commodity prices are now.”

Farmland Values Rise Even as Farming Becomes Less Lucrative

CHICAGO, Feb 8 (Reuters) - The Federal Reserve Bank of St.Louis on Thursday issued its fourth-quarter 2017 report on the agricultural economy for the Eighth Federal Reserve District. The district includes all or parts of Arkansas, Illinois, Indiana, Kentucky, Mississippi, Missouri and Tennessee.

Cade's commissioners voted 4-2 in favor of the tie-up under an agreement, negotiated between the companies and global antitrust agencies, that included the sale of several of Bayer's assets to BASF SE.

Approval of the transaction in Brazil, a powerhouse producer of grains and other agricultural commodities, clears a crucial hurdle for the deal, which the companies initially aimed to have approved by the end of 2017.

Farm Sizes Impacted by a $40,000 Crop Insurance Premium Support Limit

Proposals have been made to limit the amount of Federally-paid crop insurance premiums on a per farm basis. A $40,000 limit was proposed in the last farm bill and the 2016 Trump budget included this limit as well. The sizes of corn and soybean farms that reach a $40,000 limit are examined for two counties in Illinois: a low risk county (McLean County) and a higher risk county (Saline County). For the low risk county, the farm size impacted by the limit is near 3,000 acres, not a particularly large farm. In the higher risk county, the farm size impacted by the limit is near 1,000 acres, a farm size that is relatively small by commercial grain farm standards. The 3,000 and 1,000 acre benchmarks assume 100% of share in crop production on farmland. Use of share rent agreement increases proportionally the acres necessary to reach the limit.

Background

The Federal government subsidizes a portion of the total premium of Federal crop insurance policies and this premium support represents a large portion of total Federal outlays associated with crop insurance. An often-made proposal has been to limit Federal premium support on a per farm basis. A crop insurance subsidy limit has some precedence in that commodity title programs have had limits throughout history (see farmdoc daily, March 24, 2017). Except for peanuts, program crop payments under the 2014 Farm Bill are limited to $125,000 per individual (farmdoc daily, August 21, 2014). Limits generally arise from equity concerns about individuals receiving too large benefits from the government. An often-discussed limit on crop insurance subsidies is $40,000 per farm. Once a farm reaches the $40,000 limit, all remaining premium would be paid entirely by the farmer. The remainder of this article shows farm sizes at which the $40,000 limit is reached.

Swarm Bots Could Shift Ag History

Picture a swarm of tiny robots moving down the rows of a cotton field, mechanical spider arms plucking multiple bolls per second and depositing fiber into holding containers. Ginning begins immediately within the containers as the bots move on to more plants. Scoffers beware: Agriculture is on the cusp of historical change.

Robotic harvest is knocking on the door of traditional row crop production and cotton growers may bring in the first fruits. A massive technological push steered by Cotton Incorporated aims to deliver automated harvest via fleets of swarm robots to U.S. fields within 10 to 15 years. Coordinated field research is underway in multiple states and the results may benefit the entire spectrum of U.S. agriculture.

A commercial prototype system could be ready in just over a decade, according to Ed Barnes, senior director of Agriculture and Environmental Research at Cotton Incorporated. Weaving together technological development projects across the Cotton Belt, Barnes hopes to fundamentally impact the dynamics of cotton production by opening the door to small acreage growers, lowering overall costs and improving lint quality.